Khadija Sharife takes a look at the links between Hong-Kong-based private entity China International Fund, Angola’s state oil company Sonangol and Zimbabwe’s diamond fields.
What does Manuel Vicente’s rise to top office in Angola mean for Zimbabwe, and what role does China play in all of this? Vicente is believed to be pegged at vice president by José Eduardo dos Santos – one of Africa’s longest running dictators, bound to win the next Angolan elections in 2012. Once in office dos Santos may well take a holiday, giving the job of five years uninterrupted rule to Vicente.
Presently, Vicente heads Angola’s state oil company, Sonangol, interlocked, through no less than nine different subsidiaries with private Hong Kong-based entity China International Fund (CIF). The CIF is Zimbabwe’s largest foreign investor (US$8 billion), active in various sectors, including infrastructure but also diamonds, via the entity Sino-Zim.
The use of Hong Kong as a jurisdiction becomes a little more obvious when exploring the legal and financial opacity services that generate a not insignificant percentage of their GDP. As the Financial Secrecy Index revealed, companies are not required to put details of trusts, company ownership, or beneficial ownership on public or official records. This is precisely the secrecy that remains so invaluable to political and corporate looters, including the use of nominees to cloak the real identities of the people involved.
Company documents, provided by sources, confirmed the information painstakingly collected by the US-China Economic & Security Review Commission (2009), which alleged a connection between the Chinese government and CIF. The company, for instance, is located at Suites 1011-1012, 10/F, Two Pacific Place. Incorporated on 3 December 2003, the main shareholders include Dayuan International Development Limited (99 per cent), based at the same address, and a business woman by the name of Lo Fung Hung (1 per cent).
Dayuan, created in 2003, was previously known as Beiya International Development Limited (Beiya) until 2006. The company is chiefly owned by New Bright International Development Limited, who directors include Hung and Veronica Fung.
Running the names and Hong Kong identity numbers of directors Hung – P178129(8) and Fung – D553467(5), identified both as the two primary directors spanning the Queensway corporate pyramid. (The Golden China Consultants company, nominee secretarial entity, was also listed.)
Publicly, and even privately (if low and medium-level Chinese officials are to be believed), there are no ties that bind China’s government to the CIF in an official partnership capacity. But CIF is rumoured to be interlocked with the Chinese state through revolving door officials, backdoor financing, resource trading and hidden beneficiaries.
Another of the five-fingered Queensway director web, Wu Yang, listed his registered address at 28/F 14 Dong Chang'an Street, Beijing, China, an office for the Ministry of State Security, though this connection is deemed expired.
But others claim any CIF-PRC connection is simply commercial. Angolan activist and journalist Rafael de Morais quotes a Chinese official who said, cynically, of the company, ‘CIF has no construction record or credentials…Largely they are brokers who get contracts from the Angolan government and sell them to other Chinese companies for huge profits.’
However opaque CIF may be to the Chinese state, as regards Angola’s, there can be no denying the cosiness, via the joint subsidiaries as well as the US$2.9 billion in funding for Angolan construction projects, administered by Angola’s Gabinete de Reonstrução Nacional and financed by China International Fund Limited (CIFL).
The man pegged as Fung's husband, Xu Jinghua, is the chair – and perceived silent director, of many of the Queensway Group's entities, including CIF. Xu, considered to be at the helm of oil trading and construction in Angola, and more broadly, Africa, was quoted in the Asia Times (2007) as 'boasting' that his Angolan construction pie was worth an estimated US$30 billion.
The intimacy between CIF and the Angolan regime was glimpsed at via Wikileaks where China's ambassador to Angola, Bholum Zhang, states that CIF enjoys a 'close relationship' with President Dos Santos. Here, Xu plays a key role, maintaining close connections with his Russian military academy comrade and classmate, Angolan President – and lifetime dictator, Dos Santos.
The US report, in an attempt to broaden his profile, included claims by the Argentinean media, of Xu's potential Cambodian origins. Sources, however, revealed that Xu is indeed a PRC citizen (identity number: 330203550608095 Chinese name: 徐京華)with one dissolved company under his belt (China Kilter Trading), and almost anonymous business dealings thereafter, through the use of nominee directors such as Wang Xiangfei (director of 16 Queensway entities, and husband of Lo Fung Hung).
China Sonangol and CIF are documented as having invested US$15 billion in Guinea and Zimbabwe in 2009 – US$7 billion for the former, announced in October 2009, and US$8 billion for the latter, announced in November, 2009. In Zimbabwe, the company, Sino-Zimbabwe, incorporated as Sino-Zim Diamond Limited – a Hong Kong entity, evidences the close ties between international diamond magnate Lev Leviev, the Angolan government and the CIF.
Leviev first came into contact with the CIF in Angola. Through companies like Leviev's Africa-Israel Investment, he managed to acquire 10 per cent of one Queensway entity, Artfield, which would later change its name to China Sonangol Resources Limited (2009).
But Angola is not only Africa's largest – and the world's second largest, supplier of oil, to China. It also a major supplier of KP-certified diamonds through entities such as the Israeli Leviev group.
Sino-Zim, previously known as Rich Loyal Corporation Limited, which has since claimed to cease diamond mining in the company's allocated concession (but has requested and received another concession), is managed by the Leviev group's Namibian arm, Samicor. Sino-Zim director include Singapore-based lawyer Jeremy Zerenie, and longtime Leviev hand, Eliezer Nefussy. Holding an Israeli passport (12874136), and based in Pionerspark, Windhoek, Namibia, Nefussy – head of the Leviev Group in Namibia – was appointed one month after Sino-Zim was incorporated.
According to one source, a key architect in the KP, and preferred to remain anonymous, Leviev had been sniffing around Zimbabwean diamonds for quite some time. But with his bases across Africa, ranging from extraction to cutting and polishing, Leviev – active in many conflict regions, is often labeled as the man who broke the De Beers diamond cartel, first in Russia and then, chiefly, Angola, by going after the source, much like Marc Rich did with oil. During his reign at SAMICOR (equipped with state-of-the-art technology) Nefussy has been quoted as saying Leviev's Namibian plants needed more, bigger and better diamonds.
Though Zimbabwe's US$800 billion diamond fields - now ranking as the world's seventh largest producer, ahead of Angola, have an airstrip, with a light cargo plane making daily trips, it is not known whether, or indeed, the volume of Zimbabwean diamonds, KP-washed through the Leviev group, with billions in diamond sales.
Nefussy appears to have become an old diamond under Leviev, holding positions in Namibia's diamond industry through myriad key entities owned by the Leviev Group, such as LL Mining, parent company of Namibia Minerals Corporation (NAMCO).
The company was located in Robert Mugabe Avenue, Windhoek.
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* Khadija Sharife is southern Africa correspondent for The Africa Report, a contributing researcher for the Tax Justice Network and
visiting scholar at the UKZN Center for Civil Society.
* Please send comments to editor[at]pambazuka[dot]org or comment online at Pambazuka News.
 Nambia's official diamond valuator, Global Diamond Valuators (GDV), known for large financial donations to the SWAPO regime, is advising diamond mining companies in Zimbabwe, including Anjin and Mbada, on KPCS compliance.